How does a Buyer's Agent get compensated?
If the property is listed with an Agent, the Buyer's Agent
is normally able to negotiate a division of the commission
the Seller has committed to pay to the Listing Agent. This
commission division would be comparable to the arrangement
a Listing Agent would have with an Agent who was a sub-agent.
The Buyer's Agent is receiving a part of the fee the Seller
is paying to the Listing Agent. Since the Buyer's Agent does
not represent the Seller's interest, this fee division should
be disclosed to all parties.
In cases where
the Buyer's Agent locates a property suitable to the Buyer
that is not listed with an Agent, the Buyer's Agent will attempt
to negotiate a fee arrangement with the Seller for providing
a Buyer. The Seller would normally be responsible for paying
this fee to an Agent who he might list the property with.
The Buyer's Agent would disclose to the Seller that he does
not represent the Seller in this matter, but represents the
Buyer.
In some cases,
the Buyer's Agent is not able to negotiate an acceptable commission
division with a Listing Broker or with the Seller. In these
situations, the Buyer decides what value the property is worth
to him and submits the offer with the stipulation that the
Buyer's Agent fee will be paid out of the purchase price at
closing to the Buyer's Agent.
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